Fee Structures

 

 

 

 

FEE STRUCTURES

 

J.G. Hendricks Financial Services can work with clients in three different ways:

Traditional Commission-Based Approach

Fee-Based Approach

Fee Only Approach

Under the traditional commission-based approach, the client pays a commission each time a transaction occurs. There are different ways to structure these commissions for different types of products. This is the method that has been used in traditional brokerages accounts for many, many years. However, the marketplace is changing, and commission-based accounts are falling out of favor.

The fee-based approach is rapidly becoming a very popular way to conduct business, and J.G. Hendricks Financial Services, LLC is currently using this method for most of its new clientele. Under this arrangement, the client pays a negotiated, contractual fee that is debited directly from their account on a quarterly basis. The fee is based upon a percentage of assets under management (see table below). This approach puts the advisor and the client on the same side of the table. It also obligates the advisor to always be working in the best interest of the client, whereas in the traditional brokerage relationship, the advisor is only required to recommend “suitable” investments for the client. The client never pays any commissions, so the client knows that any recommendations made by the advisor are in the client’s best interest.

Finally, a fee only approach may be used for a particular client who wishes to retain asset management, but use the advisor in a planning and advisory capacity only. The advisor will bill the client at a pre-negotiated hourly rate based upon the types of services that are requested.

J.G. Hendricks Financial Services, LLC prefers to meet with their clients at least twice annually, and will usually be willing to meet with clients at a time and location of the client’s convenience. This applies to both individual and business clients. During these meetings, particularly with fee-based clients, a comprehensive financial review is performed that takes into account not only a client’s investments, but all other areas of their financial lives, as well. We review liabilities, insurance policies, tangible assets, and account structures. We make recommendations to our clients with the mutual goal of allowing our clients to maximize their potential to help reach their long-term financial objectives.